Moodys.com
Close
Please Note
We brought you to this page based on your search query. If this isn't what you are looking for, you can continue to Search Results for ""
The maximum number of items you can export is 3,000. Please reduce your list by using the filtering tool to the left.
Close
Close
Email Research
Recipient email addresses will not be used in mailing lists or redistributed.
Recipient's
Email

Use semicolon to separate each address, limit to 20 addresses.
Enter the
characters you see
Close
Email Research
Thank you for your interest in sharing Moody's Research. You have reached the daily limit of Research email sharings.
Close
Thank you!
You have successfully sent the research.
Please note: some research requires a paid subscription in order to access.
Already a customer?
LOG IN
Don't want to see this again?
REGISTER
OR
Accept our Terms of Use to continue to Moodys.com:

PLEASE READ AND SCROLL DOWN!

By clicking “I AGREE” [at the end of this document], you indicate that you understand and intend these terms and conditions to be the legal equivalent of a signed, written contract and equally binding, and that you accept such terms and conditions as a condition of viewing any and all Moody’s inform​ation that becomes accessible to you [after clicking “I AGREE”] (the “Information”).   References herein to “Moody’s” include Moody’s Corporation, Inc. and each of its subsidiaries and affiliates.

Terms of One-Time Website Use

1.            Unless you have entered into an express written contract with Moody’s to the contrary, you agree that you have no right to use the Information in a commercial or public setting and no right to copy it, save it, print it, sell it, or publish or distribute any portion of it in any form.               

2.            You acknowledge and agree that Moody’s credit ratings: (i) are current opinions of the future relative creditworthiness of securities and address no other risk; and (ii) are not statements of current or historical fact or recommendations to purchase, hold or sell particular securities.  Moody’s credit ratings and publications are not intended for retail investors, and it would be reckless and inappropriate for retail investors to use Moody’s credit ratings and publications when making an investment decision.  No warranty, express or implied, as the accuracy, timeliness, completeness, merchantability or fitness for any particular purpose of any Moody’s credit rating is given or made by Moody’s in any form whatsoever.          

3.            To the extent permitted by law, Moody’s and its directors, officers, employees, representatives, licensors and suppliers disclaim liability for: (i) any indirect, special, consequential, or incidental losses or damages whatsoever arising from or in connection with use of the Information; and (ii) any direct or compensatory damages caused to any person or entity, including but not limited to by any negligence (but excluding fraud or any other type of liability that by law cannot be excluded) on the part of Moody’s or any of its directors, officers, employees, agents, representatives, licensors or suppliers, arising from or in connection with use of the Information.

4.            You agree to read [and be bound by] the more detailed disclosures regarding Moody’s ratings and the limitations of Moody’s liability included in the Information.     

5.            You agree that any disputes relating to this agreement or your use of the Information, whether sounding in contract, tort, statute or otherwise, shall be governed by the laws of the State of New York and shall be subject to the exclusive jurisdiction of the courts of the State of New York located in the City and County of New York, Borough of Manhattan.​​​

I AGREE
Rating Action:

Moody's increases refinancing margins for some Danish covered bonds; TPI reduced

10 Jun 2011

London, 10 June 2011 -- Moody's Investors Service has today increased the refinancing margins and lowered the timely payment indicator (TPI) to High from Very High for the covered bonds in the following programmes:

BRFkredit, Capital Centre B

BRFkredit, Capital Centre E

BRFkredit, General Capital Centre

DLR Kredit A/S, Capital Centre B

DLR Kredit A/S, General Capital Center

Nordea Kredit Realkreditaktieselskab, Capital Centre 2

Nykredit Realkredit A/S, Capital Centre D

Nykredit Realkredit, Capital Centre E

Nykredit Realkredit A/S, General Capital Centre

Nykredit Realkredit A/S, Capital Centre G

Realkredit Danmark A/S, Capital Centre S

Realkredit Danmark A/S, General Capital Centre

The covered bonds of the following programmes are not affected by the above changes:

Danske Bank A/S - Register D

Danske Bank A/S - Register I

Nordea Kredit Realkreditaktieselskab Capital Centre 1

Nykredit Realkredit A/S Capital Centre C

Totalkredit Realkreditfond Capital Centre C

At the same time, Moody's has aligned the rating for the junior covered bonds (JCB) of Nykredit Realkredit's Capital Centre E with the issuer's rating. The JCB rating remains under review for possible downgrade, as Nykredit Realkredit's issuer rating also remains under review for possible downgrade.

RATINGS RATIONALE

The refinancing margins have been increased following the material rise in adjustable-rate mortgage (ARM) loans in Danish cover pools. The outstanding volume of bonds for financing ARM loans increased to DKK1,217 billion from DKK636 billion between 2008 and 2011, according to the 2011 Financial Stability report of Denmark's Nationalbank. These covered bonds now represent about half of all outstanding covered bonds in Denmark.

ARM loans differ from other mortgage products financed in the Danish covered bond market, as there is a mismatch between the underlying loan term and the term of the covered bond refinancing the loan. Typically, ARM loans mature after twenty to thirty years, while the covered bonds mature every one to three years. Hence, there is refinancing risk and the issuers' dependence on regular market access to issue covered bonds has increased with the growing volume of ARM loans. Moody's acknowledges that this risk is mitigated by the "pass-through" nature of the loans, with any increased funding costs being passed directly to the underlying borrower. However, Moody's still considers this product to be more exposed to refinancing risk than traditional products, where the loan and bond term is matched.

Moody's notes that Danish issuers have started to spread their refinancing requirements for ARM loans over the year rather than concentrating the refinancing of ARM loans to December of each year. In our opinion, the spreading out of the refinancing requirements is a positive development but not in itself sufficient to fully remove the refinancing risk inherent in ARM loans.

Moody's has also looked at the reduction in the levels of systemic support for Danish banks compared with pre-crisis levels. In a low support environment, Danish banks owning covered bond issuers may not have as great a capacity to support the covered bond market as they had in the past. At the same time Moody's notes that the credit worthiness of independent mortgage credit institutions has weakened. Moody's considers this a relevant factor to take into account in the context of the increased refinancing that needs to take place in the market.

Moody's views the Danish covered bond market as a robust one, having been strong through the financial crisis of 2008, and assumes it will continue to function effectively in most conceivable circumstances. This is reflected in the TPI assessment of High, which compares favourably to other European jurisdictions with strong covered bond frameworks.

RATING METHODOLOGY

The principal methodology used in this rating was Moody's Approach to Rating Covered Bonds published in March 2010.

Moody's considers the increased refinancing risk in terms of (i) the expected loss analysis; and (ii) the TPI assessment.

(i) Moody's determines the covered bond rating based on the expected loss of the bond. The increase of the refinancing margin increases the modelled cover pool losses due to market risk. Moody's expected losses due to market risk, following issuer default, have increased from an average 4% to an average of 7%, at present. The relevant issuers may be able to offset any deterioration in the expected loss by adding further collateral to their programmes. Moody's will monitor the issuer's decisions and incorporate them into its rating assessment. For JCBs, Moody's has removed any uplift over and above the issuer's rating, following the additional stresses added to the analysis through increased refinancing margins. Higher refinancing stresses result in reduced recoveries for the JCB. Hence, the expected loss analysis no longer results in a single-notch uplift above the issuer rating.

(ii) Moody's assigns a TPI which indicates the likelihood that timely payment will be made to covered bondholders following issuer default. The covered bond's refinancing risk is an important consideration for setting the TPI and Moody's has reduced the TPI from Very High to High for all but three covered bonds programmes. A TPI of High reflects a high likelihood of timely interest and principal payments. The covered bond programmes not affected by the TPI reductions are programmes with negligible shares of ARM loans relative to the level of overcollateralisation in the cover pool, namely Nykredit Realkredit A/S Capital Centre C, Totalkredit Realkreditfond Capital Centre C and Nordea Kredit Realkreditaktieselskab Capital Centre 1. For the JCB, Moody's has not assigned a TPI given the full linkage between the rating of the JCB and the issuer's rating.

SENSITIVTY ANALYSIS

The TPI framework will limit the covered bond rating if the issuer's rating is downgraded below a certain level. The TPI Leeway measures the number of downgrade notches of an issuer's rating that a covered bond rating can withstand, without suffering a downgrade under Moody's TPI framework. The reduction of the TPI from Very High to High implies for most covered bond programmes that the TPI Leeway is reduced by one notch. Based on the current issuer rating and a TPI of High, the TPI Leeway of Danish covered bond programmes is between one and five notches, which means that the current TPI Leeway does not pose a cap to the maximum possible covered bonds rating. Moody's will publish the TPI Leeway for every covered bond programme in due course.

The rating assigned by Moody's addresses the expected loss posed to investors. Moody's ratings address only the credit risks associated with the transaction. Other non-credit risks have not been addressed, but may have a significant effect on yield and to investors.

REGULATORY DISCLOSURES

Information sources used to prepare the credit rating are the following: parties involved in the ratings, parties not involved in the ratings, public information and confidential and proprietary Moody's Investors Service information.

Moody's Investors Service considers the quality of information available on the issuer or obligation satisfactory for the purposes of maintaining a credit rating.

The rating has been disclosed to the rated entity or its designated agents and issued with no amendment resulting from that disclosure.

LIST OF AFFECTED SECURITIES

Issuer: Nykredit Realkredit, Capital Centre E

....474NYKEJCB15 Junior Covered Bond due 1/1/2015, Downgraded to A1 and Remains On Review for Possible Downgrade; previously on Apr 19, 2011 Aa3 Placed Under Review for Possible Downgrade

....F3NYKEJCB13 Junior Covered Bond due 10/01/2013, Downgraded to A1 and Remains On Review for Possible Downgrade; previously on Apr 19, 2011 Aa3 Placed Under Review for Possible Downgrade

....F6NYKEJCB16 Junior Covered Bond due 04/01/2016, Downgraded to A1 and Remains On Review for Possible Downgrade; previously on Apr 19, 2011 Aa3 Placed Under Review for Possible Downgrade

....F6NYKEJCB14 Junior Covered Bond due 01/15/2014, Downgraded to A1 and Remains On Review for Possible Downgrade; previously on Apr 19, 2011 Aa3 Placed Under Review for Possible Downgrade

....EUR500M Junior Covered Bond due 04/01/2014, Downgraded to A1 and Remains On Review for Possible Downgrade; previously on Apr 19, 2011 Aa3 Placed Under Review for Possible Downgrade

....287NYKEJCB14 Junior Covered Bond due 10/01/2014, Downgraded to A1 and Remains On Review for Possible Downgrade; previously on Apr 19, 2011 Aa3 Placed Under Review for Possible Downgrade

....EUR200M Junior Covered Bond due 12/30/2011, Downgraded to A1 and Remains On Review for Possible Downgrade; previously on Apr 19, 2011 Aa3 Placed Under Review for Possible Downgrade

Moody's Investors Service may have provided Ancillary or Other Permissible Service(s) to the rated entity or its related third parties within the three years preceding the Credit Rating Action. Please see the ratings disclosure page www.moodys.com/disclosures on our website for further information.

Moody's adopts all necessary measures so that the information it uses in assigning a credit rating is of sufficient quality and from sources Moody's considers to be reliable including, when appropriate, independent third-party sources. However, Moody's is not an auditor and cannot in every instance independently verify or validate information received in the rating process.

Please see ratings tab on the issuer/entity page on Moodys.com for the last rating action and the rating history.

The date on which some Credit Ratings were first released goes back to a time before Moody's Investors Service's Credit Ratings were fully digitized and accurate data may not be available. Consequently, Moody's Investors Service provides a date that it believes is the most reliable and accurate based on the information that is available to it. Please see the ratings disclosure page on our website www.moodys.com for further information.

Please see the Credit Policy page on Moodys.com for the methodologies used in determining ratings, further information on the meaning of each rating category and the definition of default and recovery.

London
Alexander Zeidler
Vice President - Senior Analyst
Structured Finance Group
Moody's Investors Service Ltd.
JOURNALISTS: 44 20 7772 5456
SUBSCRIBERS: 44 20 7772 5454

Madrid
Juan Pablo Soriano
MD - Structured Finance
Structured Finance Group
Moody's Investors Service Espana, S.A.
JOURNALISTS: 44 20 7772 5456
SUBSCRIBERS: 44 20 7772 5454

Moody's Investors Service Ltd.
One Canada Square
Canary Wharf
London E14 5FA
United Kingdom
JOURNALISTS: 44 20 7772 5456
SUBSCRIBERS: 44 20 7772 5454

Moody's increases refinancing margins for some Danish covered bonds; TPI reduced
No Related Data.
© 2019 Moody’s Corporation, Moody’s Investors Service, Inc., Moody’s Analytics, Inc. and/or their licensors and affiliates (collectively, “MOODY’S”). All rights reserved.

CREDIT RATINGS ISSUED BY MOODY'S INVESTORS SERVICE, INC. AND ITS RATINGS AFFILIATES (“MIS”) ARE MOODY’S CURRENT OPINIONS OF THE RELATIVE FUTURE CREDIT RISK OF ENTITIES, CREDIT COMMITMENTS, OR DEBT OR DEBT-LIKE SECURITIES, AND MOODY’S PUBLICATIONS MAY INCLUDE MOODY’S CURRENT OPINIONS OF THE RELATIVE FUTURE CREDIT RISK OF ENTITIES, CREDIT COMMITMENTS, OR DEBT OR DEBT-LIKE SECURITIES. MOODY’S DEFINES CREDIT RISK AS THE RISK THAT AN ENTITY MAY NOT MEET ITS CONTRACTUAL FINANCIAL OBLIGATIONS AS THEY COME DUE AND ANY ESTIMATED FINANCIAL LOSS IN THE EVENT OF DEFAULT OR IMPAIRMENT. SEE MOODY’S RATING SYMBOLS AND DEFINITIONS PUBLICATION FOR INFORMATION ON THE TYPES OF CONTRACTUAL FINANCIAL OBLIGATIONS ADDRESSED BY MOODY’S RATINGS. CREDIT RATINGS DO NOT ADDRESS ANY OTHER RISK, INCLUDING BUT NOT LIMITED TO: LIQUIDITY RISK, MARKET VALUE RISK, OR PRICE VOLATILITY. CREDIT RATINGS AND MOODY’S OPINIONS INCLUDED IN MOODY’S PUBLICATIONS ARE NOT STATEMENTS OF CURRENT OR HISTORICAL FACT. MOODY’S PUBLICATIONS MAY ALSO INCLUDE QUANTITATIVE MODEL-BASED ESTIMATES OF CREDIT RISK AND RELATED OPINIONS OR COMMENTARY PUBLISHED BY MOODY’S ANALYTICS, INC. CREDIT RATINGS AND MOODY’S PUBLICATIONS DO NOT CONSTITUTE OR PROVIDE INVESTMENT OR FINANCIAL ADVICE, AND CREDIT RATINGS AND MOODY’S PUBLICATIONS ARE NOT AND DO NOT PROVIDE RECOMMENDATIONS TO PURCHASE, SELL, OR HOLD PARTICULAR SECURITIES. NEITHER CREDIT RATINGS NOR MOODY’S PUBLICATIONS COMMENT ON THE SUITABILITY OF AN INVESTMENT FOR ANY PARTICULAR INVESTOR. MOODY’S ISSUES ITS CREDIT RATINGS AND PUBLISHES MOODY’S PUBLICATIONS WITH THE EXPECTATION AND UNDERSTANDING THAT EACH INVESTOR WILL, WITH DUE CARE, MAKE ITS OWN STUDY AND EVALUATION OF EACH SECURITY THAT IS UNDER CONSIDERATION FOR PURCHASE, HOLDING, OR SALE.

MOODY’S CREDIT RATINGS AND MOODY’S PUBLICATIONS ARE NOT INTENDED FOR USE BY RETAIL INVESTORS AND IT WOULD BE RECKLESS AND INAPPROPRIATE FOR RETAIL INVESTORS TO USE MOODY’S CREDIT RATINGS OR MOODY’S PUBLICATIONS WHEN MAKING AN INVESTMENT DECISION. IF IN DOUBT YOU SHOULD CONTACT YOUR FINANCIAL OR OTHER PROFESSIONAL ADVISER.

ALL INFORMATION CONTAINED HEREIN IS PROTECTED BY LAW, INCLUDING BUT NOT LIMITED TO, COPYRIGHT LAW, AND NONE OF SUCH INFORMATION MAY BE COPIED OR OTHERWISE REPRODUCED, REPACKAGED, FURTHER TRANSMITTED, TRANSFERRED, DISSEMINATED, REDISTRIBUTED OR RESOLD, OR STORED FOR SUBSEQUENT USE FOR ANY SUCH PURPOSE, IN WHOLE OR IN PART, IN ANY FORM OR MANNER OR BY ANY MEANS WHATSOEVER, BY ANY PERSON WITHOUT MOODY’S PRIOR WRITTEN CONSENT.

CREDIT RATINGS AND MOODY’S PUBLICATIONS ARE NOT INTENDED FOR USE BY ANY PERSON AS A BENCHMARK AS THAT TERM IS DEFINED FOR REGULATORY PURPOSES AND MUST NOT BE USED IN ANY WAY THAT COULD RESULT IN THEM BEING CONSIDERED A BENCHMARK.

All information contained herein is obtained by MOODY’S from sources believed by it to be accurate and reliable. Because of the possibility of human or mechanical error as well as other factors, however, all information contained herein is provided “AS IS” without warranty of any kind. MOODY'S adopts all necessary measures so that the information it uses in assigning a credit rating is of sufficient quality and from sources MOODY'S considers to be reliable including, when appropriate, independent third-party sources. However, MOODY’S is not an auditor and cannot in every instance independently verify or validate information received in the rating process or in preparing the Moody’s publications.

To the extent permitted by law, MOODY’S and its directors, officers, employees, agents, representatives, licensors and suppliers disclaim liability to any person or entity for any indirect, special, consequential, or incidental losses or damages whatsoever arising from or in connection with the information contained herein or the use of or inability to use any such information, even if MOODY’S or any of its directors, officers, employees, agents, representatives, licensors or suppliers is advised in advance of the possibility of such losses or damages, including but not limited to: (a) any loss of present or prospective profits or (b) any loss or damage arising where the relevant financial instrument is not the subject of a particular credit rating assigned by MOODY’S.

To the extent permitted by law, MOODY’S and its directors, officers, employees, agents, representatives, licensors and suppliers disclaim liability for any direct or compensatory losses or damages caused to any person or entity, including but not limited to by any negligence (but excluding fraud, willful misconduct or any other type of liability that, for the avoidance of doubt, by law cannot be excluded) on the part of, or any contingency within or beyond the control of, MOODY’S or any of its directors, officers, employees, agents, representatives, licensors or suppliers, arising from or in connection with the information contained herein or the use of or inability to use any such information.

NO WARRANTY, EXPRESS OR IMPLIED, AS TO THE ACCURACY, TIMELINESS, COMPLETENESS, MERCHANTABILITY OR FITNESS FOR ANY PARTICULAR PURPOSE OF ANY CREDIT RATING OR OTHER OPINION OR INFORMATION IS GIVEN OR MADE BY MOODY’S IN ANY FORM OR MANNER WHATSOEVER.

Moody’s Investors Service, Inc., a wholly-owned credit rating agency subsidiary of Moody’s Corporation (“MCO”), hereby discloses that most issuers of debt securities (including corporate and municipal bonds, debentures, notes and commercial paper) and preferred stock rated by Moody’s Investors Service, Inc. have, prior to assignment of any rating, agreed to pay to Moody’s Investors Service, Inc. for ratings opinions and services rendered by it fees ranging from $1,000 to approximately $2,700,000. MCO and MIS also maintain policies and procedures to address the independence of MIS’s ratings and rating processes. Information regarding certain affiliations that may exist between directors of MCO and rated entities, and between entities who hold ratings from MIS and have also publicly reported to the SEC an ownership interest in MCO of more than 5%, is posted annually at www.moodys.com under the heading “Investor Relations — Corporate Governance — Director and Shareholder Affiliation Policy.”

Additional terms for Australia only: Any publication into Australia of this document is pursuant to the Australian Financial Services License of MOODY’S affiliate, Moody’s Investors Service Pty Limited ABN 61 003 399 657AFSL 336969 and/or Moody’s Analytics Australia Pty Ltd ABN 94 105 136 972 AFSL 383569 (as applicable). This document is intended to be provided only to “wholesale clients” within the meaning of section 761G of the Corporations Act 2001. By continuing to access this document from within Australia, you represent to MOODY’S that you are, or are accessing the document as a representative of, a “wholesale client” and that neither you nor the entity you represent will directly or indirectly disseminate this document or its contents to “retail clients” within the meaning of section 761G of the Corporations Act 2001. MOODY’S credit rating is an opinion as to the creditworthiness of a debt obligation of the issuer, not on the equity securities of the issuer or any form of security that is available to retail investors.

Additional terms for Japan only: Moody's Japan K.K. (“MJKK”) is a wholly-owned credit rating agency subsidiary of Moody's Group Japan G.K., which is wholly-owned by Moody’s Overseas Holdings Inc., a wholly-owned subsidiary of MCO. Moody’s SF Japan K.K. (“MSFJ”) is a wholly-owned credit rating agency subsidiary of MJKK. MSFJ is not a Nationally Recognized Statistical Rating Organization (“NRSRO”). Therefore, credit ratings assigned by MSFJ are Non-NRSRO Credit Ratings. Non-NRSRO Credit Ratings are assigned by an entity that is not a NRSRO and, consequently, the rated obligation will not qualify for certain types of treatment under U.S. laws. MJKK and MSFJ are credit rating agencies registered with the Japan Financial Services Agency and their registration numbers are FSA Commissioner (Ratings) No. 2 and 3 respectively.

MJKK or MSFJ (as applicable) hereby disclose that most issuers of debt securities (including corporate and municipal bonds, debentures, notes and commercial paper) and preferred stock rated by MJKK or MSFJ (as applicable) have, prior to assignment of any rating, agreed to pay to MJKK or MSFJ (as applicable) for ratings opinions and services rendered by it fees ranging from JPY125,000 to approximately JPY250,000,000.

MJKK and MSFJ also maintain policies and procedures to address Japanese regulatory requirements.

​​​​​​
Moodys.com